Human capital theory suggests that job opportunities will create incen
tives for students to invest, or not invest, in education. If the Econ
omic structure of the community does not reward education, students mi
ght drop out of school. The existing research on this topic, which is
based on several disciplinary perspectives, is reviewed. Data from Vir
ginia indicate that a higher percentage of service occupations in the
county increases the dropout rate. A higher percentage of managerial/p
rofessional occupations decreases the dropout rate and increases the p
ercentage of graduates continuing their education. In addition, the mo
del tested for differences in educational achievement in Appalachian a
nd non-Appalachian counties. Appalachian counties differ from urban, b
ut not from other rural counties. Urban counties have a higher percent
age of both dropouts and graduates continuing their education.